Arcus Biosciences Inc. Common Stock (RCUS)

FairStock Score: 30/100 — RISKY

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

I am wary of businesses that depend on future miracles more than present earnings. Arcus is a clinical-stage oncology company with several candidates: Casdatifan, Domvanalimab, Zimberelimab, and Quemliclustat. The filed numbers show no durable profitability. In fiscal 2025, the year ended 2025-12-31, revenue was $33.0M and net loss was $353.0M, or -$3.29 per diluted share. That followed fiscal 2024 revenue of $51.0M and a $283.0M loss, and fiscal 2023 revenue of $37.0M and a $307.0M loss. In fiscal Q2 2026, the quarter ended 2026-06-30, revenue was $33.0M and net loss was $91.0M, or -$0.72 per diluted share. Sales are tiny against expenses, and the company has not earned a profit. FairStock's Lynch category is none, because losses occurred in each of the last four years. What is the moat? At this stage, I see none in the Graham sense. A biotech moat is only proven by approved products, pricing power, and recurring cash flow; Arcus has none of those yet. Competitive advantage, if any, lives in clinical data and intellectual property, not in the income statement. Financial health is strained. Trailing free cash flow is -$475.0M, a FairStock FCF yield of -16.6%. Based on the close on 2026-10-13 at $22.51, FairStock calculates P/E -5.71, P/B 6.17, ROE -90.82%, ROCE -30.39%, Piotroski F-Score 2/9, and Altman Z-Score 1.58. Debt-to-equity is 0.51. The $2.9B market cap already discounts substantial pipeline success. Growth trajectory is speculative: losses narrowed in fiscal Q2 2026 versus fiscal Q1 2026, but revenue is lumpy and milestone-dependent. I would demand a large margin of safety, which the current price does not provide on these figures.

In plain English: Arcus Biosciences is a drug company that is still testing cancer therapies and has no profits. It has very little revenue and large yearly losses, so the business looks financially weak today. At $22.51, its $2.9 billion market value is high compared with those current sales and losses, so the price does not look cheap based on the numbers shown.

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Data as of 2026-10-13 close · note generated 2026-10-15 · model deepseek-flash

Sources (SEC EDGAR): fiscal Q2 2026 10-Q (period ended 2026-06-30) · fiscal Q1 2026 10-Q (period ended 2026-03-31) · fiscal Q3 2025 10-Q (period ended 2025-09-30) · fiscal Q2 2025 10-Q (period ended 2025-06-30) · FY2025 10-K (period ended 2025-12-31) · FY2024 10-K (period ended 2024-12-31) · FY2023 10-K (period ended 2023-12-31)

Fundamentals from company filings and market-data providers; prices are end-of-day, not real-time. AI-generated analysis is general and educational — not personal investment advice. Scoring methodology · Score test · Disclaimer